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Mich. Panel OKs $31M For Health Care Exchange

LANSING (AP) – A Michigan legislative panel on Wednesday voted to spend the $31 million in federal grant money allocated for the creation of the state’s online health insurance marketplace, a key component of the federal health care overhaul.

The 24-3 vote by the House Appropriations Committee signals the Republican-led Legislature may be ready to back GOP Gov. Rick Snyder’s plan to pursue a partnership controlled almost entirely by the federal government.

The online exchange is supposed to make it easier for people and businesses forced to carry insurance under the health care law.

Michigan was awarded a $31 million federal grant for the exchange. But Snyder needs legislative approval to spend it.

GOP legislators last year rejected his preference for a state-run marketplace. A partnership exchange lets states handle some customer service functions and approve insurers who want to offer health plans on the website.

The full House could vote this week on the spending bill before moving it to the Senate.

House Appropriations Chairman Joe Haveman, R-Holland, said the partnership is a better option than turning over complete control to the federal government. Some conservative activists have pressured lawmakers to cede everything to federal officials, arguing they are unprepared for the number of states choosing not to participate.

“We would not choose to implement this big-government health care program willingly, but a federal health care exchange is coming to Michigan, whether or not we like it,” Haveman said in a statement. “The Supreme Court’s ruling and the re-election of President Obama have exhausted our options for avoiding this reality and forced us to act. … Choosing the state-federal partnership will lower costs for Michigan taxpayers and retain as much local control as possible over this federal overreach.”

Fourteen Republicans and all 10 Democrats on the committee voted for the spending bill. Three Republicans opposed it.

Open enrollment on the exchange for hundreds of thousands of uninsured Michigan residents begins Oct 1. Coverage kicks in Jan. 1, 2014.

The Snyder administration says spending the $31 million grant will save the state from having to spend its own money to make technology changes to link electronically with a federal exchange. It also argues that having a partnership will save Michigan insurers wanting to offer health plans on the exchange from an extra layer of regulation in Washington.

The exchange – likened to Travelocity or Expedia – will be used in part to determine people’s eligibility for Medicaid and, if they buy private insurance on the exchange, whether they qualify for income-based federal aid to help pay their premiums.